Cardlytics Q2 FY26 earnings call CDLX

Cardlytics reported clear progress against its strategic priorities in Q2 FY26, with investments in people, advertiser business, and the tech platform beginning to deliver results. The company observed accelerating advertiser growth, improving churn, and stabilized supply. Key priorities include deepening bank partnerships, expanding the publisher network, driving incremental advertiser revenue through purchase intelligence, and continued investment in its differentiating tech platform.

The industry is shifting towards merchant-funded, locally relevant rewards programs, with Cardlytics positioned at the center of this trend. Market interest in the Cardlytics Rewards Platform (CRP) remains strong, with positive feedback from pilot partners. Existing bank partners are expanding their card-linked offers programs, and one major bank temporarily reduced its FI share to accelerate co-development and innovation, leading to a 105% increase in total redemptions in a recent program.

The advertiser base demonstrated significant growth, with active advertisers up 18% QoQ and new logo volume increasing 59% QoQ. Churn improved substantially, down 50% by advertiser count and 88% by dollar impact. Cardlytics' purchase intelligence is proving valuable, helping advertisers understand market shifts, such as QSR spend moving to third-party delivery services, enabling them to adjust strategies from broad acquisition to retention and re-engagement.

Following investments in tech debt cleanup and building an AI-forward tech stack, Cardlytics is operating more efficiently. New AI capabilities automatically pull industry and brand-level spending insights from purchase data, used by advertisers for benchmarking and trend analysis. An AI-driven campaign publishing engine automates workflows, reducing ad campaign building time in the US by half compared to a year ago, while maintaining a 99.4% internal target hit rate.

New platform capabilities allow banks to personalize rewards for their customer segments, such as high-tier or at-risk customers, through APIs. This enables tailored reward values, offer rankings, and bank-funded offers. Additionally, token-based solutions are being developed to embed Cardlytics' offers protocol across various partner experiences, aiming to extend reach and meet more consumers wherever they are.

Cardlytics' everyday spend data indicates a rebound in US consumer spend growth, reaching 3.6% year over year in June, up from 2.3% in May, primarily driven by lower-spend households. Gas and convenience spend showed resilience, increasing 11.1% YoY, while discretionary dining growth flattened. QSR spend grew 3.3% YoY due to menu inflation, with real demand remaining flat, as spend shifted significantly to delivery services.